How to Turn Around a Failing Health Club

Club owners with a failing business may feel hopeless, but you can reverse the decline and restore stability to your business—most of the time. First, however, you must look at key factors to determine if your health club is a good candidate for a successful turnaround or whether it’s just too late.

Ask yourself the following questions:

Is your health club still a viable business? If you were going to open this club today, what would you need to know to make an informed decision?

Is there still enough time left to get this done? Are there any hard deadlines looming that could stop you in your tracks?

Is there enough available cash to get this done? If your cash flow is good enough, many times you can get a simple float. If not, you will need outside funding.

Do you have a clear vision about how your health club should operate? Have you done this before? Do you know how this should look?

Do you have the proper management team and leadership in place? Are your key people truly committed to the success of the health club?

Do your shareholders have confidence in you and your club? Your stakeholders will see you as the person who got them into this mess. You will need to win these folks over again if you are going to be successful.

Do you have a structured and proven approach to get out of this mess? Go with what’s known and proven. This is no time for guesswork.

Once you have answered these questions, you should take the following steps:

Ask for help, and do it now. Most health club owners wait until it’s too late.

Get an immediate grip on your finances. Only pay what will keep you in business. Everything else can wait.

Take an objective look at your situation and develop short-term and long-term priorities. Don’t let emotion rule your decision-making. Be willing to make the difficult decisions.

Determine what has caused the underperformance. If you don’t know why this happened, you are doomed to repeat the mistake. Re-establish discipline.

Create a marketing plan and get the entire management team on board for the planned objectives. Do your research. Now is not the time to test new marketing ideas. Go with what’s proven.

Get supplier and vendor support to ensure your plan can happen. Don’t ignore these folks. Meet with each of them and let them know your situation and your intentions.

Become an expert at health club management, particularly sales management. Surround yourself with people who are better than you are at what you are asking them to do. Get your system in place.

Keep everyone involved in the process. Communicate with them about what is going on.

Don’t keep anyone guessing. Communication is the key to almost anything, but it’s the foundation when trying to keep everyone on the same page during a health club turnaround.

Manage the process. Let people know what needs to be done and why. Then follow up by training them how to do it.

Know your numbers. Don’t let the process of change distract you from the need to manage your health club. Track everything that is done in your health club just like you normally would.

Manage with a cautious optimism. Know the risks moving forward and be prepared to deal with them. Many elements can stall your turnaround progress. Make a list of these potential setbacks and then a have plan if this were to happen.

Keep your foot on the accelerator. Don’t let up—ever. Don’t take success for granted. It’s hard work. Be on the lookout for success apathy.

Now, go turn around your health club.

Jim Thomas is the founder and president of Fitness Management USA Inc., a management consulting and turnaround firm specializing in the fitness and health club industry. With more than 25 years of experience owning, operating and managing clubs of all sizes, Thomas lectures and delivers seminars and workshops on the practical skills required to successfully build teamwork and market fitness programs and products.